To understand the devastating debt situation, President Ruto has no money to meet his development and services provision obligations. He cannot pay pensions.
He is unable to make disbursements of constitutional revenue share to counties. Funding education capitation has become a nightmare to him, forcing schools to charge parents exorbitant fees.
Pending bills are overwhelming leading to auction and shut down of businesses.
The Treasury, National Assembly and Presidency are directly responsible for taking the country down this dangerous path.
The most unfortunate thing is that the loans were used on non-revenue-generating projects, which have not benefited the country economically.
In addition to the mismanagement of loans, the government has been spending heavily on wasteful and duplication recurrent expenditures.
The country is struggling to repay its huge debt.
While President Ruto took a high-interest loan to avert a direct default of the Eurobond due to maturity in June 2024, this only compounded the debt problem.
The country already has debt distress that is sucking oxygen out of the economy.
The expensive loan to partly resolve the threatening Eurobond crisis only kicked the can down the road at a very high cost. Borrowed loans in excess for the next two generations to pay in violation of the Constitution.
Ruto's government must find ways to service its debt without punishing the people. The current crisis is an indictment of the failed development model the country follows.
Kenya’s economic troubles are largely due to politicians’ penchant for overspending. The political system is directed toward serving and uplifting the people
Instead, the overriding objectives of politiciansis winning elections, staying in power, and enriching themselves and their cronies.
As a result, most politicians in office view the five-year election cycle as a period to ensure they win the next election—or accumulate enough wealth to leave with, in case they don’t.
The debt-burden moderation model in place has failed in recent decades. Despite economic growth rates, the economy has remained structurally dependent on external borrowing.
This setup is unsustainable. Economic turmoil despite purported economic growth is also attributable to the unending expansion of the public sector.
The writer is the executive director of the International Centre for Policy and Conflict